German tour operators predict better business in 2018

A recent fvw (a leading fortnightly German travel trade magazine) survey has found out that tour operators in Germany are optimistic about higher sales in 2018 with many predicting revenue growth of more than 5 %.

After relatively low market growth of about 2 % in 2017, according to market research company GfK – Growth from Knowledge estimates, German tour operators believe business will pick up more strongly this year. In particular, a stable economy, higher consumption levels and low unemployment provide a good macro-economic background for the tourism market.

Nearly all tour operators surveyed by fvw expect higher sales in 2018, with specialist tour operators particularly optimistic. Out of the 30 companies who provided figures and forecasts, nearly half expect revenues to increase by more than 5 % in 2018, while a third reckon with growth of 2 - 5 %. Only a handful expect lower or negative growth. The top three, TUI, Thomas Cook and DER Touristik, did not provide any forecasts for this year but indicated at their recent summer programme presentations that they expect single-digit revenue growth in 2018.

In terms of short- and medium-haul destinations, tour operators generally expect good business for Spain, Portugal and Croatia, increasing demand again for Greece and continued recoveries for Egypt, Turkey and Tunisia.

Among long-haul destinations, tour operators expect good bookings for Asia, South Africa and Canada, along with a recovery for the Caribbean after the impact of last autumn’s hurricanes. But they are sceptical about prospects for the USA which already suffered last year from a higher exchange rate. Operators are split over the chances of a comeback for Germans’ top long-haul destination.

In contrast, most companies foresee strong cruise holiday sales once again. “Cruises are sexy,” claimed Karl Pojer, head of Hapag-Lloyd Cruises and industry association Clia Germany. “New ships and concepts are attracting more and more people to go on a cruise holiday.” Cruise holidays are also increasingly popular among coach holiday customers.

German tour operators are also realistic about the potential risks for business this year, including political uncertainties in major destinations, the risk of terror attacks, the impact of ‘overtourism’ in some crowded destinations and the consequences of turbulences in the aviation sector.